Posts Tagged ‘great depression’

The Unemployement and the Stock Market are rising for some time now. A new Stock Market Bubble is building up and will explode in the near future. The biggest Bubble is certainly the US Deficit Bubble.

The Stock Market Bubble and the Deficit Bubble will explode as soon as the major creditors (China, India, …) of the US will move out of the Dollar. This is happening already.

The Customers are the backbone of the Economy and the Leaders understand very well that the Economy is governed by Psychology. So Bad News is hidden en Good News is exaggerated. The Expectations of Analysts are always beaten and the downfall is falling slower than before.

The Economy is still in a terrible state and this state is getting worse every day. The unemployement is still rising and will rise for a very long time because companies are getting broke or are rationalizing everything that is possible.

They replace their employees by IT-Technology and Cheap Labor. The customers are not buying, they are saving more and more money for a rainy day or are paying back their debts.

Saving money will not stimulate the economy. It stimulates unemployment. The rising unemployement results in more foreclosures and problems with credit card debts. The Economic Downturn is just at its beginning.

Economist John Williams says that– if the unemployment rate was calculated as it was during the Great Depression the unemployment figures for July 2009 rose to 20.6%. According to an article summarizing the projections of former International Monetary Fund Chief Economist and Harvard University Economics Professor Kenneth Rogoff and University of Maryland Economics Professor Carmen Reinhart,… unemployment could rise to 22% within the next 4 years or so.”

The Scenario of the Current Downturn is highly comparable with the Scenario of the Great Depression with one exception. The current Downturn is much deeper than the other. We are approaching the Biggest Global Economic Crisis in Human History.

The current investors base their policy on positive news and ignore the bad news. They believe the economy will rise when the customer-confidence is rising or when the downfall of the economy is “slowing down” or “bottoming”. They don’t see that a slowing down of a downfall is still a downfall.

The investors, the Doves, act just like the behavioral economists predict they will act. They read the headlines, believe the Hawks and are not aware of the (Money) Illusion the Government, the Media and the Banks are creating. The Hawks know better. They buy Silver, Gold and certainly the best investment, Oil.

Nouriel Roubini has a more realistic view on the economy. In his article Ten Risks to Global Growth he analyses the risks that could block the recovery of the economy and his conclusion is highly pessimistic.

According to Roubini the major cause of the crisis is overspending. Overspending is a normal activity when the Kondratiev-Cycle is in the state of Autumn. The debts are always repayed in the next phase, Winter. In the Kondratiev Winter the economy is purged and cleansed. This phase started around 2000 and will be finished around 2013. In the Winter-State you have to stay in cash or invest is Gold and Silver.

At this moment the investors don’t know what currency they have to chose for their cash-reserves. Usually the Dollar was a Save Heaven but the current policy of the FED to expand the amount of Dollars to an almost unbelievable amount is seen as a huge risk.

The Creditors (China, India, ..) of the US are already creating an alternative currency and are secretly and slowly moving out of the Dollar. If the Trust in the Dollar has gone the US Economy will go bankrupt.

The big problem with the current Cycle is that we have moved to the Level of Earth. In the last downfall of the Kondratiev Cycle other parts of the world were decoupled. They moved in a complementary mode. The Down of one part of the Earth was compensated by an Up somewhere else.

At this moment the complementary parts are synchronized and act and react according to the same rhythm. This rhythm is related to a longer term cycle that almost nobody is aware of. This cycle with a periodicity of 250 years is called the Secular Cycle.

The current level of integration of the World Economy is very dangerous. The production-processes of the Earth are highly rationalized and integrated. When one process stops the rest of the processes also has to stop.

The very high level of rationalization causes cascades or avalanches. The fast and slow avalanches generate sudden bursts of unemployment and financial disasters. The Car Industry and the Financial Industry are good examples. At this moment the avalanches start new avalanches in completely different branches of the tree of the World Economy.

The Crisis in the Banking Industry puts a large part of the Corporate Sector under severe financial stress. Firms that in the past would have been able to roll over their loans, bonds and debts now face a liquidity crisis that may lead them into costly debt restructuring.

This will affect the Banking Industry and will also put a high strain on the Bailout capacity of the Governments who are not able to leant money or inflate money until eternity.

The only solution that is left is to Rationalize even more than the Companies were planning to do. Their only solution is to speed up the use of IT (Use the Internet) and fire the employees. It is very clear that the use of IT in Companies is still in its infancy. Many manual activities can be replaced by software. The total effect will be a worsening of the current crisis.

To stop the cascades governments are starting to Protect and Regulate their Economies. The Worldwide Cooperative Institutions are losing their grip and the Free Market Economy is on its return.

Big Companies are splitted according to the old Boundaries of Power. The expansion and integration of the EG is blocked because the member states suddenly have conflicting objectives. The Rich Countries don’t want to help the Poor Countries because the Rich Countries are getting poorer with the minute.

Not only the poor member states of the EG are getting into big trouble. The same applies to the Underdeveloped Countries. The poor Countries of the World are on their own. Everybody is in the Survival mode and The Fittest, The Rich, will as always Survive.

The world is not only hit by a Economic and a Cultural crisis. The world is also hit by a Climate Crisis. Although human activity plays an important (negative) role the Cycle of the Climate related to the activities of our Sun and the Movement of Earth in our System (the Precession Cycle) is much more important.

The current change in Climate is irreversible and will have a major effect on the world economy. Climate change and ecological misuse are the major factor why Societies collapse.

The last factor and perhaps most important factor is the Energy Consumption of the World. This consumption is not only affecting the Climate but it also facilitates a huge highly integrated Transport-System.

This System is the Backbone of the Integrated Value-Chains of the Western World. The Western World is completely dependent on the transport system for its Industrial Production and the Supply of Food.

The Transport System has a devastating effect on the poor countries in the World. To make enough money to survive they have to export their products to the Western Markets ignoring their own needs.

It is certain that the supply of oil and gas is lower than the increasing demand. The resources all over the world are going down. The total effect of this all will be a dramatic rise in price. This will affect the rich countries and in particular the US. They are already the major importer of energy in the World and when you import something you have to export something else to keep the financial balance in order.

As you already know the deficit of the US is spectacular and the only reason the US is not broke is the special role of the Dollar. If the economy recovers the demand and the prices will rise and the US Economy will slow down immediately.

What is Going to Happen?

Every scenario leads to a long term decline of the Economy, our Culture and our Civilization. The theory of the short term and long term cycles is right and it is very stupid to ignore these theories.

According to the Panarchy Model the world is too connected and this leads to an increasing rigidity in its goal to retain its state. The rigidity reduces resilience and the capacity of the system to absorb change, thus increasing the threat of abrupt change. The world is unable to cope with the changes of climate and culture that are happening now. Therefore we will see the collapse of the accumulated connections and the destruction of bound up knowledge and capital.

The highly integrated structures of the Earth (the Cooperative Institutions, the Big Companies, Governments AND the Transport System) are bound to desintegrate. The impact on the local structures is immens. Communities will have to grow their own food, manufacture and repair their own tools, create their own currency etc etc on a local level again.

Most of these structures have outsourced these functions to places far away and don’t have the skills nor the resources to do this. The fittest, the Haws, will survive but it is unclear if the Doves will accept this situation forever. A Rise of the Masses just like the French Revolution in 1789 (almost 250 years ago!) is possible.

The world is moving to a very fast transformation. The only thing that can be said when we use the Panarchy Model is that it will move back to a stable state before the expansion started and start all over again. The Wisdom of the Old Civilizations that survived earlier Collapses is very valuable. These lessons are very easy to comprehend.

Civilizations die because the humans don’t want to Move with the Cycles, don’t Cooperate and don’t Respect Mother Nature. When Civilizations Collaps even the Hawks lose Everything!

Banking originates around 3000 BC in Babylonia out of the activities of temples and palaces which provided safe places for the storage of valuables. Initially deposits of grain are accepted and later other goods including cattle, agricultural implements, and precious metals.

In a later stage Silver and Gold were used to pay. From that time on Silver and Gold became weapons of war and a good reason to fight a war.

By 700 BC, the Lydians became the first in the Western world to make coins. Countries were soon minting their own series of coins with specific values. Some of the earliest known paper money dates back to China, where the issue of paper money became common from about AD 960 onwards.

Paper currency and non-precious coinage was backed by a government or bank’s promise to exchange it for a certain amount of silver or gold.

The last innovation in Money is called Fiat-Money. In this case the currency is not backed by anything but the promise of a country to enforce payment. Fiat-Money is the ultimate money generator. Governments are able to create infinite amounts of value without any guarantee.

The only guarantee is the performance of the economic system of the Country itself and the Power of the Government to force their citizens to pay the neccesary taxes. The Fiat-System has created an enormous amount of hyperinflated countries.

The US is one of the countries where paying taxes is seen as a sin. The only way to gurantee the Fiat Money is to generate a high level of inflation and/or a tremendous debt. At this moment the US is the biggest debtor in the world and it is not capable to pay his debts. The US is completely broke.

The US Fiat-System is the real cause of the current wordwide crisis. If this problem is not solved in due time all economic activity in the World will come to an end.

We will experience the same situation that existed in Germany between the two world wars (the Weimar Republic) and in many other countries were the value of money became hyperinflated. As you will see later the US Government is not able to control their own money supply.

Thomas Jefferson the third President of the US knew what would happen when the Fiat-System would be introduced in the US. This was his warning:

”I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks]… will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. …The issuing power should be taken from the banks and restored to the people, to whom it properly belongs“.

The most important practice to cheat with coins was to alter the quality or the quantity of the precious metals by reducing the weight, mixing precious metals with other metals and/or covering cheap metals with precious metals.

When paper money was introduced it became much easier to cheat. Paper Notes were copied and the kings and governments started to play with the stock of gold and silver that was needed to back the paper notes.

The precious metals also became a very important instrument of warfare. When the amount of precious metals went down the Kings were unable to pay their soldiers and had to stop fighting. Another tactic was to generate inflation or deflation. The economy of the enemy could be destroyed by influencing the economic cycle by manipulating the amount of precious metals or banknotes.

Financial manipulation or Financial Warfare on every scale is as old as the civilized world.

Every country in the world is protecting its economy by intervening in the global currency market, the Foreign Exchange Market (FOREX). These interventions are performed by the Central Banks. Most of the Central Banks are controlled by Government. An exception is the US FED.

At this moment there are three groups of Central Banks, The US (Federal Reserve), The European Union (including the UK) and what I would call the China-connection. This last group contains Brasil, Russia, India (BRIC), and many more rising economies like Indonesia, South Africa and Turkey. The China Connection is becoming one of the most powerful groups.

The first central bank of Europe was created by the Knight Templars. The medieval European Knight Templar were a medieval military and religious Order which officially came to a controversial and mysterious end on Friday, 13 October 1307 when the Roman Catholic Church closed them down, accusing their leaders of heresy and strange religious beliefs.

During the era of the Crusades the Templars possessed a huge multi-national empire, and until their demise they were arguably the most powerful organization on Earth. According to popular theory, the Templars went underground and formed the secret society of the Freemasons to preserve their secret tradition.

There is evidence that the Templars were the carriers of old mystical knowlegde related to the Gnostics. This was perhaps the real reason why they were destroyed by the Roman Church who did not like the Gnostic (Kadištu) Believe System.

The Knight Templar ran probably the best known early prototype of a central banking system, as their promises to pay were widely regarded, and many regard their activities as having laid the basis for the modern banking system. By 1200 they were in effect bankers to the kings of England and France. They became so powerful that they had to be distroyed.

The oldest central bank in the world is the Riksbank in Sweden, which was opened in 1668 with help from Dutch businessmen. This was followed in 1694 by the Bank of England at the request of the government to help pay for a war.

The US Federal Reserve (FED) was created by the US Congress through the passing of the Glass Owen-Bill, signed by President Woodrow Wilson on December 23, 1913.

The history of the FED reads like a detective story. Eustace Mullins spend almost his whole life to find out what is really happening behind the closed doors of the FED. His book was never published. That’s why it is now available for free on the Internet. It shows how the Financial Elite of the US manipulated the citizens and representatives of the US to accept the Glass Owen-Bill. My advice: Read it!

The most important fact you have to know is that the FED is not an independent bank controlled by government. It is controlled by the big banks of the US and behind the big banks of the US is a powerful elite. This Elite created and sustained the Great Depression. It also supported the Klu Klux Clan and the Fascists regimes of Germany and Italy. The most important power behind them was the House of Rotchild situated in London. The old Financial Elite never lost its power.

If you search on the Internet you will find that Free Masons, The House of Rotchild and the Knight Templar are combined into a huge conspiracy theory that even goes back in history to the Annunaki of Sumer (The Serpents). I don’t think the Knight Templar and the Free Masons are part of this conspiracy.

I do believe the conspiracy (if it exists) has something to do with the Annunaki and their Ancestors. The Annunaki were experts in deceiving people and keeping control over them. They “hated” the Female Power and changed many myths that showed that this Power could create a Paradise if we wanted it. Their very long term plan was to obtain control over the World. It looks like they are succeeding. There all kind of conspiracy theories that are trying to prove that important “blood-lines” of the Elite are related to the Annunaki.

According to many Myths (Hopi, Gnostics) the “good ones”, the Life-Designers, the Kadištut, that are trying to help mankind are related to the Pleiades. The Pleiadians don’t want to interfere because interference in another civilization is forbidden. We have to ask them for help.

The theory behind Financial Manipulation and Financial Warfare is also a very old theory. It was practiced by all the old Kings. They knew that the control of the foundation of the Money System was crucial to stay in Power. They also knew that they could win a war by destroying the financial center of their enemies.

So everybody knows that when a small Elite in a huge Country has the power to issue money they are able to control the World. Everybody knows it is very difficult not to misuse a tremendous power (“absolute power corrupts absolutely”). That is why the Control of the Creation of Money has always been a central issue in many conflicts. In a democratic country this power is controlled by Government and Parliament.

The original members of the FED created and sustained the Great Depression. They must have been aware of the fact that they were destroying the economic system at that time. After the Great Depression they owned many companies and were in control of the media. This proves they knew how to make use of a chaotic, volatile, economic system.

The current members of the FED have created a new Great Depression. They were and are throwing trillions of dollars into the system increasing the debt of the US to a level never been seen. It will destroy the US Dollar and generate hyper-inflation. History shows that each time governments printed money in the past, the consequence was sky-high inflation.

The consequence is that the coming years, the prices of energy, food and metals will go through the roof. The US Citizen will become very poor but some people, the Elite, will get richer. The Story of the Great Depression is repeating itself and the strange thing is that everybody knew and knows why this is happening. Does that prove the Conspiracy Theories?

The new Depression will almost certainly lead to World Government. It is the only way to go they claim to stop the Depression. All the structures to enforce World Government are already in place and most of them are already in control of the Financial Elite. Does this prove the Conspiracy Theories?

The big question is if the “Chinese-connection” will accept this. If not we will see a huge conflict in the near future. It will certainly start with a “financial” attack. The Chinese could wreck the US Economy by disconnecting the Yuan from the Dollar and/or sell their $2 trillion worth of treasury bonds. You see Financial Warfare is easy and you don’t need very destructive weapons to do it. Will this lead to World War III?, also a prediction of the Conspiracy Theories.

At this moment many strange and unpredictable interventions can be seen related to the Dollar vs the Euro. The Dollar is rising steadily. The rise of the Dollar has nothing to do with the real value of the Dollar. The Dollar is related to the US Economy and this economy is going down and the backing of the Dollar is not there. The US Debt is gigantic and wil rise.

The effect of the rising dollar is positive for the export of the EU to the US. This will have a negative effect on the US Economy. The most interesting effect will come when the Dollar suddenly will move back to its original value. This will generate a new crisis within the European Banking System and of course the EU Economy. Is somebody planning a financial attack on the EU??

To prove the conspiracy we have to see who will be the owner of the most important companies and media after the crisis has stopped (if it can be stopped). If a certain group has taken over a lot of companies we will know that they have done it again. If we have finally proved the conspiracy theories we will be too late.

The proof of the pudding is always in the eating. When you read this article of the New York Times you will see that the big “take-over” has already started. The Big Banks are not using the money of the Government at all to help their poor customers. They are using it to buy other “small” banks. If you read the article in the NY Times the strategy becomes very clear. They, the Elite, want to create three colossal global financial giants—Citigroup, JP MorganChase and, of course, Paulson’s own Goldman Sachs.

Why are they creating these entities? The first reason is of course that it is much easier for a cartel to manage three parts. The second reason is that this cartel will be one of the richest and powerful kartels in the world.

What could be the aim? The aim could be to destroy their European and other Wordwide Competitors. They will be helped by their friends of the world’s largest financial credit rating agencies—Moody’s and Standard & Poors end will be able to use the biggest Economy in the World to do this. It will create a “little bit of a problem to some of the poor citizins” of the US during the time of the depression but in the long term they all will profit in some way because the Power of the US will be completely restored. The US will finally rule the World.

The big question is if the citizens of the US (and other Western Countries) will accept this to happen. If they accept it we will know for certain that the Mind Control Systems, also a part of the Big Conspiracy, have done their work properly.

History is repeating itself but on a much larger scale. If the Annunaki exist they will be very proud about what it is happening. Finally they will be the Masters of a devasteted World called Earth.

Do you believe in the Conspiracy Theory?

I really don’t want to believe the Theory. I don’t want to become a paranoid. Is there any Light at the end of the Tunnel? Obama? It certainly is Time for a Change! Will he succeed to stop the power of the FED? If he leaves them in power we will know for sure he is “one of them” or he is very afraid to stop them.

Why? One of the interesting stories behind the Conspiracy Theories is the fact that the Presidents (Kennedy, Lincoln) who wanted to change the center of the Financial System, The FED, were assassinated.

The Banking Business has created the Credit-Crunch. The Banking Business has created the Great Depression. The Banking Business has created many Bubbles. The Banking Business has advised people to buy shares while they knew the shares were highly overvalued. Now the Banking Business is stimulating the Food Crisis in the World.

Analysis being carried out by World Food Program (WFP) estimates that about 100 million people have been pushed deeper into poverty by the high food prices.

The “Silent Tsunami” will affect more people on every continent than the real Tsunami in 2004. It will destroy more livelihoods and the nutrition losses will hurt children for a lifetime.

Everybody believes that Prices Rise when there is a Shortage of Something. The highest bidder takes all.

The main cause of the World Wide Food Shortage is Western Way of Producing, Selling and Wasting Food. We are Manipulating the Market and The Consumer but we are also destroying nature by fertilizers and genetical manipulated seeds. We are also throwing away a enormouss amount of food.

The Multi-Natioals produce genetic manipulated seeds, artificial fertilizers and artificial food. They control the Transportation, the Media, The Financial streams and the Governments (The World Bank). The multi-national food companies are making record profits.

The profit of Monsanto has doubled. Similarly, the Mosaic Company, one of the world’s largest fertiliser companies, saw its income rise more than 12-fold. The prices of some kinds of fertiliser have more than tripled over the past year as demand has outstripped supply. As a result, plans to increase harvests in developing countries have been hit hard.

The Farmers at the beginning of the production lines are mostly poor. They will not profit from the rise of the prices of their products. This is not something new. The Poor get poorer and the Rich get richer. They are blocked to enter the Market. They are also blocked to produce their own natural fertilizers and their own natural seeds. Most of them are now unable to be self-sufficient. They have to buy food and y are unable to pay for it.

When you are very rich you can play with “the Fundamental Law of the Market“. You can buy a lot of goods, store them and create an artificial shortage. This game is called Speculation. The Multi-Nationals are creating an artificial shortage.

When you are Hedging you use the Power of Money to Move the market UP to a certain point you want it to reach. If your hedge works out fine you leave the market when it Moves DOWN. At that time you let the “Bigger Fools” pay for the Downfall. At this moment the Tax-Payers are paying for the Downfall of the Speculators in the Housing Business. The Hedge Funds have already found a new Target, Hunger.

At this moment Hedge funds are Moving into the Food-business and they are making Big Money.

Commodity speculation spread long ago from standard products like oil and gold to anything edible and available for trade on the Chicago Futures Exchange. These days there are futures contracts for everything from wheat to oranges to pork bellies.

The futures market is a traditional tool for farmers to sell their harvests ahead of time. In a futures contract, quantities, prices and delivery dates are fixed, sometimes even before crops have been planted. Futures contracts allow farmers and grain wholesalers a measure of protection against adverse weather conditions and excessive price fluctuations. They can also help a farmer plan how much to plant for a given year.

But now speculators are taking advantage of this mechanism. They can buy futures contracts for wheat, for example, at a low price, betting that the price will go up. If the price of the grain rises by the agreed delivery date, they profit.

Some experts now believe these investors have taken over the market, buying futures at unprecedented levels and driving up short-term prices. Since last August, this mechanism has led to a doubling in the price of rice-including the 500,000 tons that the Philippine government plans to buy in early May to address its own shortage.

Experts are already discussing what they call a “Super Cycle,” set off by constantly growing demand in China, and by farmers unable, in the long term, to keep up with that demand as they sow their seed and harvest their crops. The planet has only a finite amount of land for farming.

Greg Warner has worked in the grain wholesaling business for more than two decades. His office sits a block away from the Chicago Futures Exchange. He’s an analyst with the firm AgResource, and he says what is happening now in the wheat market is unprecedented.

“What we normally have is a predictable group of sellers and buyers-mainly farmers and silo operators,” he says. But the landscape has changed since the influx of large index funds. Fund managers seek to maximize their profits using futures contracts, and prices, says Warner, “keep climbing up and up.”

He’s calculated that financial investors now hold the rights to two complete annual harvests of a type of grain traded in Chicago called “soft red winter wheat.”

Wagner is stunned by such developments. He sees them as evidence that capitalism is literally consuming itself.

One of the major players in this business is ABN AMRO. When somebody asked the manager of this business about ethics he answered that he was not interested in a discussion about this subject. “We are aware of the current discussions relating to agricultural commodities but we make the drills, but others have to do the drilling”.

The World Food Program is asking everybody to donate money. They need more money (775 million!) than the “real” Tsunami to solve the problems of the 100 million. The sad thing is that donating is helping the Hungry but is also helping the Rich. It helps them to sustain their Gamble.

In the end your donation will be payd to a very Rich Person who has enough money to buy an enormous amount of Food.

This also happens when Governement is “helping” the WFP. It is a very intelligent trick to move money from the Public Domain to the Private Domain. In the end You pay More and They Increase their Wealth. IT happened with the Credit Crunch. It happened with the Great Depression. It happens all the time.

Just like every Bubble the Food Bubble will also burst at a certain moment. It is not difficult to imagine when this will happen. It will happen when a very small part of the world is able to pay for the food.

The Bubble is already infecting the Economy of the Rich Countries. When a Very amount of people is able to buy Food the End State will be reached and the Prices will drop. At that moment The Hedge Funds will move into another area of (artificial) Shortage.

The poor people in the West are already unable to pay for the food. At a certain moment the Middle Class will feel the effects. When the Poor People in the Rich Countries will experience a Food Shortage they will Riot.

Just like the poor people in the Underdeveloped Countries are Rioting. When the Riots start in the Getto’s of the Big Cities the Rich will become Afraid. They will Ask for Protection of the Police or the Military. In the end they have to surround there homes with walls and create there own food supplies.

The rising prices not only affect the Poor. They also affect the Policy of the FED to stop the Credit Crunch. Higher prices stimulate Inflation and Inflation can only be stopped by an Increase of the Interest Rates. Higher Interest Rates will deepen the state of Depression.

Is this what the Investors really want?

The Ethics are not of My Concern. They are the Business of Somebody Else.

We Produce Weapons but we are not responsible for the Use of the Weapons.

We Fight a War but we are not responsible for the Killing of Innocent people.

We Advice people but we are not responsible for What we are Advicing them.

We Pollute the World but somebody else has to Clean Up.

We Use all the Resources of the Earth but somebody else has to Take Care of our Children.

In the advanced Western Civilization we just look at the Profit. Investors are playing their hedge in the Global Casino and just don’t realize that they are gambling away the daily food supply of the world’s poorest people.

In the old, “Savage”, civilizations the Decision Makers had to Evaluate their Decisions on the effect of Seven Generations. They Knew they needed Nature, their Neighbours and their Offspring to Survive.

Funny.

Every Company has turned itself into a Green Company. They want to “Save the Earth”.

Are the Poor People on this Earth not Included in their Policy?

I know Why. You Know Why. Money makes the World go Round?

My Advice:

Always Take Responsibility for Every Action.

We are all Part of an Ecology and someday the Ecology will React and You will encounter the same things Others are Experiencing.

Do You want to Live in an Environment where You are deprived of Food? I don’t think so. Nobody Wants that.

When I finished my blog about the Great Depression in 1929 I wanted to write about the Great Depression of 2008. I was convinced this would happen again. I am not the only one. Many known and unknown people are warning about a worldwide economic disaster (a deep recession).

The Central Banks are pumping money into the market to prevent this to happen but to their big surprise the market is not able to use this money because the banks are afraid to lend money to other banks because there is no trust at all.

They want to revive the system but the system is in a very special and dangerous state called StagFlation. It is slowing down AND speeding up in terms of prices and the creation of money. Stagflation is something the Economist cannot handle. It is a Catch 22-situation. What you do, it always works against you.

Another problem is caused by the collective believe that things are going wrong. People stop to invest and to buy which generates a downward spiral. You can lower the interest rates to zero but when many people are afraid to buy they don’t need a credit.

The collective believe-system is the most important factor. When the Central Bank is lowering the rates it is telling two stories at the same time. The first story is that it is doing something to help but it also confirms the believe that something is really wrong.

The second story is more powerful than the first story. People don’t believe in the financial system anymore. It has destroyed itself. What the people need is self-confidence and a way to solve their own problems but The System that is there to help them is in trouble itself.

The only way out is that people start to cooperate without the “interference” of the big complex dying systems. The Rich could simply lend their money directly to the “poor” entrepreneurs. There are enough people available to create new businesses but they are simply stopped by the incomprehensible System that has lost its own Entrepreneurship long ago.

The Rich, the Investors, don’t want do this because they don’t know how to trust an Entrepreneur. They want to be helped by experts who really don’t know what they are talking about because they are way beyond the practices of real life. The experts live in a highly abstract world that is dominated by Models and Models have nothing to do with Reality. They are a product of the Imagination. To solve our problems we have to move back to Earth and become Practical again.

In a blog I explained to so called Domino-effect. When one domino falls all the domino’s fall. At this moment all the banking-domino’s are preventing the domino-effect to take place. They are afraid they will lend something to another bank that will fall.

The banks are unable to show their credibility because they are unaware of their own risks. The financial structure of a bank has become incomprehensible because of the very complex products based on expectations and the failing IT-Systems that are unable to show what is really happening. Everything is connected to everything. The financial community is a highly complicated knot.

Many people are trying to comprehend the current situation but they are missing the right theory. Suddenly I remembered the Resilience Alliance (RA). They have created a beautiful theory to explain ecologies. It is not difficult to see that the financial system is an ecology.

RA has defined an adaptive cycle with four distinct phases: growth, conservation, collapse and reorganization. The cycle contains two major phases, the fore-loop (growth and conservation) and the back-loop (collapse and reorganization).

At that time an Innovation in Religion came into the World. This innovation can be summarized by the famous statement of Socrate Know Thyself. When we Know Our Selves we will be inspired by our Inner Light. Know Thyself has been translated into many practical approaches like Socratic Learning, Socratic Decision Making (Sociocracy) and of course the Cooperation.

The most important point is not to believe in the Apocalyps but to understand that a collapse is always followed by growth and conservation but on a new level. Believing in the End will generate the End. Our collective imagination is one of the strongest forces on Earth. Look for the signs of the new structure that will enfold out of the old one. Join people that are driven by Spirit and Soul. They are everywhere.

The back-loop is a rapid phase. During the fore-loop wealth is slowly accumulated and competitive processes lead to a few dominant species. The fore-loop destroys diversity. This is what happening in nature and it looks like the same thing is happening in other human ecologies. When most of the diversity is gone the ecology is highly connected and vulnerable to external influences. When something unexpected happens the total ecology collapses.

My feeling is that we are now in a state were many ecologies are collapsing at the same moment. They are collapsing because Nature is collapsing at an impressive speed. We are not heading for a Great Depression but we are heading for the Big Collapse.

The back-loop is a rapid phase. Suddenly the Weather changes with an incredible speed. Suddenly the Financial Market is evaporating and we are unable to do anything. Suddenly major conflicts start and we are unable to manage them with the current systems.

According to RA after the collapse the ecology reorganizes itself by jumping back to a “hidden” state that was stored in its memory a very long time ago.

How far back do we have to go in history to find our rescue? In another blog I wrote about the destructing cycle that was caused by a new insight that was given to the world by Socrate and the Buddha.

The implosion took place because Something or Somebody was pushing the economy UP while it wanted to go down. An artificial Up-movement of the Economy is called a Bubble.

J.P. Morgan was highly involved with the introduction of Fascism in Europe and the US.

He believed that the major enemy in the World were the Communists.

He was befriended with Mussolini and Hitler and organized a fascists putsch in the US by his own private army, the American Legion.

The putsch failed. The legion was used as a recruiting base for the rebirth of the Ku Klux Klan.

Morgan organized the US Communist Party to create an internal external enemy. Morgan used many other dirty tricks to accomplish his goals.

The British Empire was the largest empire in human history. At the time of the Great Depression it controlled a quarter of the world’s population (458 million) and total land area.

The ruling class of the Empire came out of old families and was trained in special institutions like Eton and Cambridge.

The British Empire was based on the ideology of “Free trade”. “Free trade” was necessary to expand the markets of the British Factories. The factories needed raw materials, logistics and markets.

When a country or a person blocked the free trade the British Army removed the obstacles.

Free trade was organized in Trading Companies. They created strategic outposts. When the outposts controlled the region the British Management System (Law, Education) was implemented.

The main goal of the System was to keep the natives under control, and to develop them slowly, and along their own lines.

The British Elite was very practical. They were conservative men with relativistic notions about what forms of government suited peoples (or ‘races’) best. They didn’t go in for ideal systems.

They also knew they did not have the numbers of personnel to try to revolutionize her subjects so they always used local collaborators. They practiced the method of “indirect rule”.

The American Friends of the British Elite shared the commercial attitude of their British friends. They opened up new markets and protected their trade.

They even invented a new tool, Financial Manipulation. In every other aspect they were very different. They were highly ideological and therefore not practical.

They were convinced they were the carriers of the Best Ideology on Earth, Capitalism.Their first priority was to Destroy the Evil Empire and the friends of the Evil Empire, the Soviet Union.

In contrary to their British friends they were not interested in indirect rule. When an enemy was destroyed they left the country and were convinced everybody would embrace their System.

The Power of the House of Morgan was lessened by the New Deal of Eleanor Roosevelt in 1933. Roosevelt organized a Social Contract that gave more influencers the possibility to take part in the US Government.

The Financial Power of Morgan never disappeared. His group is still behind many influential financial companies (Morgan Stanley, JPMorgan Chase) and institutions like the World Bank.

JPMorgan is reincarnated in the person of Jamie Dimon (JPMorgan Chase). He is playing the same game as his predecessor and is behind many of the intelligent tricks that are now performed behind the scenes in Washington.

Is History Repeating Itself??

The Economy was bubbling because the Government was “pumping” a huge amount of money into the economy. Therefore it was very easy to lend, to spend and to gamble with money on the stock-exchange.

Many people gambled enormous amounts of money on the Stock-Market but on Black Tuesday they lost their bet. They lost their bet because suddenly nobody believed the Up-state would continue.

Why was the US Government pumping so much money into the Economy?

The strange thing happened that the major money pumping engine (the FRS) was controlled by the Government of the British Empire. The US Government was not involved. It was totally powerlesss.The British Empire needed money to maintain the backing of the British Pound (The Golden Standard) and the “old boys” network in the Financial Business just made a deal.

The Government of the British Empire was controlled by an Elite. Lord Montagu Norman of the Bank of England and Benjamin Strong of the New York Federal Reserve Bank were of the same club. They arranged the Bubble.

Behind the Elite was one Very Important Person, J.P. Morgan. He was the sole owner of a small company called the House of Morgan. The House of Morgan held effective control of the American government for much of the late nineteenth and early twentieth centuries. Morgan used the US central banking system to increase the ability to lend more money than he possessed. US Citizens paid taxes and their money was used to realize the plans of Morgan and his friends.

Morgan helped his friends (including the Bush family(!)) to get rid of their huge debts and to “buy” many important US companies (AT&T, US Steel).

After Black Tuesday the “friends of Morgan” held directorships in 167 industrial concerns, banks, railroads, and utilities. They controlled the most important media in the United States, including the New York Times.